Competition is part and parcel of life when you’re running a business. Lots of companies might be selling products or services similar to yours. This makes it crucial for you to make yourself stand out from your competitors.
How can you do that?
The best way to set yourself apart from your competition is service differentiation. It’s making a community, engaging with your customers, ensuring consistent branding, maximizing product functionality, and a lot of other things we’ll discuss below.
But is service differentiation really necessary for business success? Let’s find out.
What Is Service Differentiation?
Service differentiation is a business tactic used by companies to differentiate their services from competitors through branding, customer service, product features, usability, and other factors.
It’s the incorporation of attributes like functionality, quality, and more to make customers realize your services are different from other companies and, therefore, desirable.
This type of differentiation is mostly used by companies performing daily customer-facing interactions. However, any company can employ service differentiation as a tool to increase customer loyalty, success, and satisfaction, as well as sales and ROI.
Benefits of Service Differentiation
Standing out from the crowd is always beneficial for a company. But what are these touted benefits? Let’s look at some below.
1. It Enhances Brand Engagement
When you differentiate yourself through consistent and effective branding, you entice potential and converted leads to engage with your front-line personnel.
Direct engagement helps you fast-track complaints, gain insights into your customer base, and increase your sales, ROI, customer loyalty, and customer success, which leads us to our next point.
2. It Increases Customer Loyalty
When customers feel seen and heard, they form attachments with your brand. Who doesn’t like it when company managers solve their problems as fast as possible?
As a result, your customer promotes your brand to anyone they know or would think might like your products, leave testimonials and reviews, and create a stream of income you know won’t dry up as long as you’re putting out good products and satisfying your customers.
3. It Strengthens Your Reputation
Your reputation is what prompts customers to buy from you. If you frequently get two-star or three-star reviews and don’t pay attention to your customers sooner rather than later, you won’t have any buyers anymore.
However, when you implement service differentiation strategies like 24/7 customer service, you can increase customer satisfaction, improve your brand reputation, and help you gain and convert more leads.
4. It Makes Your Services Easy to Access
Increasing the functionality and usability of your website or e-commerce page while implementing consistent branding across it can make your service channels easy to access, increasing your leads and conversions.
Plus, when you implement consistent branding on all your service pages, customers become aware of whom they’re giving their money. And your brand almost becomes a living entity that customers believe in and trust, which builds industry authority.
5 Ways You Could Use Service Differentiation
Now that you know why service differentiation is useful, let’s talk about ways you could implement it in your company:
1. Stand Out Through Your Branding
Branding helps you make a memorable impression on your customers, clarify your offer, separate yourself from competitors, explain why you’re the better choice, promote recognition, and improve your brand reputation.
It also helps your customers understand what to expect from your company and allows you to build lasting relationships with your audience, which can lead to higher customer success rates and customer loyalty.
2. Set Yourself Apart Through Customer Service
Customer service is the connection that links you to your customers. It allows you to increase leads, convert more customers, enhance customer success and loyalty, generate referrals, and improve sales.
Plus, it helps you answer customer questions and queries without any delays, adds value to your service, and even increases employee retention, which can make your company more productive.
3. Increase the Functionality, Reliability, and Usability of Your Service
If you’ve been getting a slew of 3-star reviews in the past or your competitors have been getting them, read customer reviews, find common pain points, and include them in your marketing campaigns.
Similarly, find out what customers are constantly complaining about. If you can take that feedback to improve your service, that’s all the better because it’ll help your service stand out from your competitors.
4. Get Creative with Product Options
If you sell detailing waxes and someone wants to try them, they wouldn’t want to buy a gallon of them from you. Instead, they’ll probably want an ounce or two and try them before buying in bulk.
Most consumers work like that. They won’t buy things they’ve never tried in bulk, no matter how attractive you make your offer. So, always provide options to your customers — that’ll benefit you in the form of happy customers and increased conversions.
What does that look like in action? Let’s look at an example.
If you’re a pay stub generation company with a premium paystub generator, offer your customers a free use period during which they can try your service and find out if they like it. Charging them upfront might cause them to walk away.
5. Play Around with Pricing
Consider pricing structures like bundles, sales, and bulk offers to maximize your impact and sales. For instance, if you sell face razors and lots of people ask you to send them three or four at once, you could create a bulk offer and discount it. That’ll increase your sales and ROI.
Similarly, you could sandwich two complementary hot-selling products into a bundle while cutting the price.
The Bottom Line
Service differentiation can help you make your company stand out from the competition, enhance customer loyalty and satisfaction, improve brand reputation, and increase your return on investment.
If you’re looking to increase your customer conversions and audience, implement service differentiation in your company. You don’t have to overhaul everything. Instead, start small, and go big.